A Velocity of 3 Means Money Changes Hands, on Average

question 6

Multiple Choice

A velocity of 3 means money changes hands, on average, every

• A) 3 years.
• B) 4 months.
• C) 3 months.
• D) 1/3 of a month.

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Definitions:

Stated Rate

The annual interest rate stated on a bond or loan, without accounting for compounding or other effects.

Rate Of Return

Refers to the gain or loss on an investment over a specified time period, expressed as a percentage of the investment's cost.

Insurance Agent

A professional authorized to sell and service insurance policies, representing either one or multiple insurance companies.

Annuity

A monetary tool that disburses a set sequence of payments to a user, predominantly aimed at serving as a financial resource for retirees.